While the ACCC has indicated that it could yet block NAB’s acquisition of Challenger’s mortgage management business, the industry appears largely supportive of the deal.
ACCC chairman Graeme Samuel said the acquisition would come under scrutiny, with particular attention paid to NAB’s ability to restrict other lenders from accessing Challenger’s PLAN, Choice and FAST broking platforms.
But Mortgage and Finance Association of Australia CEO Phil Naylor told Mortgage Business that the ACCC investigation was unlikely to stop the deal going through.
“The ACCC might like to be seen to be putting pressure on the deal but I don’t think they will stop it from going through,”
“After all, this will not be the first time a non-bank lender has been swallowed by a major bank,” he said.
In August last year, the Commonwealth Bank of Australia bought a 33 per cent stake in Aussie, who subsequently bought Wizard in February 2009.
NAB had originally shown interest in acquiring Wizard but was pipped at the post at the 11th hour.
While Mr Naylor said NAB’s acquisition will consolidate the market a little more, the deal should be encouraged.
“While it would be great to see some competition re-emerge in the non-bank market space, it was always going to be unlikely given the current lending constraints,” he said.
“Ultimately this deal will provide Challenger with much needed funds to keep their business ticking over in profit.”
Mr Naylor’s thoughts were echoed by Connective principal Mark Haron who said the acquisition would help keep Challenger and its mortgage broking platforms alive.
Mr Haron said while it was unlikely the ACCC would stop the deal altogether, they may implement parameters around which the business has to operate.
“You might see the ACCC ask NAB to divest itself of one of the aggregation platforms in order to minimise concentration and competition concerns,” Mr Haron told Mortgage Business.
“NAB may keep Challenger separate and run it independently; similar to the way Westpac handled St George.
“I guess only time will tell.”
The ACCC is expected to finalise its view on the deal early next month.